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World News | China’s Belt and Road Initiative looms as multiple austerity constrains China economically: Prof Christopher Clary

The LATAM Airlines plane hit the vehicle on the runway (Image: Twitter / @AirCrash_)

London [United Kingdom]March 9 (ANI): China’s Belt and Road Initiative (BRI), which emerged in a particular global and economic context, is now coming to an end, with China entering a period of less funding and facing multiple crises that limit what China can do Produce economically, said Christopher Clary, an assistant professor of political science at the University at Albany.

Clary made the remarks during a virtual seminar entitled “China in South Asia: Investment or Exploitation?” Wednesday.

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As many countries around the world experience China’s growing involvement in their economies and societies, the London-based nonprofit Democracy Forum focused on China’s role as a major source of development funding in South Asia during a virtual workshop.

In highlighting the changing landscape affecting China, Clary made three main points. He said: “First of all, the ‘Belt and Road’ initiative emerged in a specific global and economic context, which is coming to an end, and China will enter a period of less capital, facing a real estate investment bubble, rising labor costs, an aging population issues such as globalization and welfare imperfections. the country, with implications for labor force participation and consequent restrictions on what China can produce economically.”

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He also said that, therefore, China’s growth may not exceed what India, Bangladesh or other countries can achieve, and India’s likely long-term accelerated growth means that India may have more money to invest overseas, creating Chinese investment. alternative options. Second, significant external economic, social or political pressure faced by any society creates antibodies against such pressure, and China is not immune to problems caused by the lack of integration of its expatriate population, as in Pakistan, Clary said. Third, he sees a real limit to China’s overseas investments, as multipolarity would give intractable regimes options that have been lacking in past decades.

Clary is under no illusions about Chinese goodwill, but he said it is difficult to both generate economic power and use that power for political ends.

Lord Bruce, TDF chairman, said: “China is pursuing a broad and aggressive program of public infrastructure investment to spread the benefits of economic growth, or conversely, if it is pursuing a process that may tacitly amount to colonialism.”

He cites an article in The Economist that concluded that the world now owes China’s eight largest state-owned banks at least $1.6trm — equivalent to 2% of global GDP. On investment and development, Lord Bruce highlighted that China is currently pricing in relatively high interest rates (nearly 6%), pursuing a loan-to-grant ratio of 31:1, despite accounting for around 36% of all lending since 2013 A loan scheme launched under the Belt and Road Initiative has encountered “execution problems”.

He also touched on China’s loans and arms supplies to Bangladesh and the diplomatic clout Beijing might expect to wield from the relationship, as well as Sri Lanka’s cumulative loan obligations to China, which have reached 20 percent of its total public external debt, And how China is Pakistan’s largest bilateral creditor, holding $30 billion in its total debt, and Pakistan is also hobbled by contractual obligations accumulated under the China-Pakistan Economic Corridor (CPEC).

He also said that Chinese money “goes to two kinds of borrowers; those who have a good chance of paying back (either because the project is likely to be profitable, or because the government is rich enough), or those where any money lost represents something worth paying for.” The one who pays the price for diplomatic advantage”.

As far as South Asia is concerned, Lord Bruce concluded that China’s international development standards always seemed to favor the second category of borrowers.

According to Dr Frederic Grare, Senior Policy Fellow at the European Council on Foreign Relations, China’s involvement in the South Asian security complex is a growing reality, ever-changing and multifaceted. But it’s important not to overgeneralize, because not every South Asian country shares the same view of China’s willingness to impose hegemony in the region, and the concept of security itself is evolving.

Greer also spoke of China’s “weaponization” of every sector of activity. Including impact on connectivity, environment, all of which could be a potential weapon. This is manifested through the issue of dependencies – eg the Maldives, the 99-year lease of Hambantota port in Sri Lanka – and the subsequent impact on India and neighboring countries as a whole.

Is China pursuing debt-trap diplomacy? Gray asked. It’s not that Beijing intentionally indebted countries in order to better control them – there are issues of local responsibility, such as economic mismanagement, after all. However, that doesn’t mean China isn’t trying to play tricks on national debts — Sri Lanka and Pakistan, for example — and that’s where coercion can start.

Islamabad-based physicist, author and activist Pervez Hoodbhoy spoke about the scale and limits of China’s geopolitical, economic and cultural influence in Pakistan. He spoke of “huge expectations” that CPEC will transform Pakistan’s economy, with China’s $62.5 billion investment in infrastructure and power generation ushering in a new era of development for Pakistan. Pakistan, however, is in default and seeks a $1.1 billion bailout from the IMF.

Hoodbhoy also highlighted China’s “stealth” presence in Gwadar, as well as Pakistan Army machine guns along the CPEC highway. This is the source of resentment among the Baluchi who feel they have been colonized by Punjab. As for the Chinese, they are very isolated and rarely interact with the locals. “CPEC has not delivered on its promises,” Hoodbhoy said.

Pakistan has $30 billion in loans to repay with unknown interest. Looking ahead, Hoodbhoy does not see CPEC delivering on its promises, nor does he foresee China’s influence in Pakistan growing to the extent once speculated. China is likely to be rethinking its relationship with Pakistan; China feels insecure after attacks on Chinese workers in Pakistan. This is unfortunate, Hoodbhoy said, as Pakistan has a lot to learn from China, especially in terms of technology and work ethic.

TDF chairman Barry Gardiner said at the end of the event that each country is pursuing its own interests, while China is both seeking investment and exploitatively taking advantage of any default. You can form alliances, but don’t mistake them for friendships, he warns. Be realistic, each country acts in its own interest, but it should be public interest, not private interest, as seen by elites in Sri Lanka and Pakistan. Regarding the Pakistani youth who wish to leave, Gardner stressed that it is difficult for them because they are under-educated in science and technology, but over-educated in religion. (Arnie)

(This is an unedited and auto-generated story from a Syndicated News feed, the content body may not have been modified or edited by LatestLY staff)

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